Spruce Pine Mfg

question 151

Multiple Choice

Spruce Pine Mfg. Co. has total fixed costs of $300,000 a year. The owner estimates that average variable costs for its product will be about $30 next year. The selling price to wholesalers will be $50. The break-even point is:

• A) 6,000 units.
• B) 10,000 units.
• C) 12,000 units.
• D) 15,000 units.
• E) None of the above is correct.

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Definitions:

Order Receipt Time

The time that elapses from when an order is placed to when it is received.

Customer Response Time

The duration it takes for a company to address and resolve a customer's inquiry or complaint.

Completed Order

A customer request that has been fully processed, manufactured, or serviced and is ready for delivery.

Activity-Based Management

A management approach focusing on managing activities as a way to improve the quality and reduce the costs of goods produced or services provided.